Weingarten Realty Investors (NYSE: WRI) and Retail Opportunity Investments (NASDAQ:ROIC) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, dividends, analyst recommendations, valuation and earnings.

Dividends

Weingarten Realty Investors pays an annual dividend of $1.54 per share and has a dividend yield of 5.7%. Retail Opportunity Investments pays an annual dividend of $0.75 per share and has a dividend yield of 4.4%. Weingarten Realty Investors pays out 94.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Retail Opportunity Investments pays out 241.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Weingarten Realty Investors has increased its dividend for 8 consecutive years. Weingarten Realty Investors is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Weingarten Realty Investors and Retail Opportunity Investments’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Weingarten Realty Investors 36.86% 12.07% 4.85%
Retail Opportunity Investments 14.13% 2.86% 1.34%

Valuation and Earnings

This table compares Weingarten Realty Investors and Retail Opportunity Investments’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Weingarten Realty Investors $549.55 million 6.28 $238.93 million $1.63 16.48
Retail Opportunity Investments $237.19 million 7.81 $32.48 million $0.31 54.45

Weingarten Realty Investors has higher revenue and earnings than Retail Opportunity Investments. Weingarten Realty Investors is trading at a lower price-to-earnings ratio than Retail Opportunity Investments, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Weingarten Realty Investors has a beta of 0.53, suggesting that its share price is 47% less volatile than the S&P 500. Comparatively, Retail Opportunity Investments has a beta of 0.58, suggesting that its share price is 42% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Weingarten Realty Investors and Retail Opportunity Investments, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Weingarten Realty Investors 0 3 2 0 2.40
Retail Opportunity Investments 0 4 3 0 2.43

Weingarten Realty Investors currently has a consensus target price of $33.50, indicating a potential upside of 24.67%. Retail Opportunity Investments has a consensus target price of $22.17, indicating a potential upside of 31.32%. Given Retail Opportunity Investments’ stronger consensus rating and higher probable upside, analysts plainly believe Retail Opportunity Investments is more favorable than Weingarten Realty Investors.

Insider and Institutional Ownership

79.3% of Weingarten Realty Investors shares are held by institutional investors. Comparatively, 97.9% of Retail Opportunity Investments shares are held by institutional investors. 7.3% of Weingarten Realty Investors shares are held by insiders. Comparatively, 2.2% of Retail Opportunity Investments shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Weingarten Realty Investors beats Retail Opportunity Investments on 10 of the 17 factors compared between the two stocks.

Weingarten Realty Investors Company Profile

Weingarten Realty Investors is a real estate investment trust (REIT). The Company’s primary business is leasing space to tenants in the shopping centers it owns or leases. The Company also provides property management services. The Company is in the business of owning, managing and developing retail shopping centers. As of December 31, 2016, the Company had owned or operated under long-term leases, either directly or through its interest in real estate joint ventures or partnerships, a total of 220 centers, primarily neighborhood and community shopping centers, which were located in 18 states spanning the country from coast to coast with approximately 44.7 million square feet of gross leasable area. Its centers are located principally in the South, West Coast and Southeast Coast of the United States with concentrations in Arizona, California, Florida and Texas. It also owned interests in 28 parcels of land that totaled approximately 19.8 million square feet, as of December 31, 2016.

Retail Opportunity Investments Company Profile

Retail Opportunity Investments Corp. (ROIC) is a fully integrated, self-managed real estate investment trust (REIT). The Company specializes in the acquisition, ownership and management of necessity-based community and neighborhood shopping centers on the west coast of the United States, anchored by supermarkets and drugstores. Retail Opportunity Investments Partnership, LP is the operating partnership of the Company. The Operating Partnership holds substantially all the assets of the Company and directly or indirectly holds the ownership interests in the Company’s real estate ventures. The Operating Partnership conducts the operations of the Company’s business. As of September 30, 2017, the Company’s portfolio consisted of 87 properties totaling approximately 10.0 million square feet of gross leasable area (GLA). As of September 30, 2017, the Company’s portfolio was approximately 97.3% leased.

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